M. Katju, J.—Heard learned counsel for the parties.

2. This special appeal has been filed against the impugned judgment of the learned single Judge dated 7.8.2004. We have heard learned counsel for the parties and have carefully perused the impugned judgment.

3. The facts have been given in detail in the judgment of the learned single Judge and we are only referring to the same as and where necessary.

4. By the 73rd Constitutional amendment Article 243G was inserted in the Constitution of India. Article 243G reads as follows :

“243G. Powers, authority and responsibilities of Panchayats.—Subject to the provisions of the Constitution, the Legislature of a State may, by law, endow the panchayats with such powers and authority as may be necessary to enable them to function as institutions of self-Government and such law may contain provisions for the devolution of powers and responsibilities upon Panchayats at the appropriate level, subject to such conditions as may be specified therein, with respect to—

(a) the preparation of plans for economic development and social justice ;

(b) the implementation of schemes for economic development and social justice as may be entrusted to the